▲ Hyundai E&C signs a strategic partnership with energy IT firm 60Hz through equity investment
...Establishing an integrated IT platform for energy trading and solution delivery, paving the way for full-scale business expansion.
-Generating synergies across the group to achieve net-zero initiative through joint investment with Hyundai Motor Company’s ZER01NE and Hyundai Motor Securities
▲ Accelerating net-zero operations via power brokerage trading, leveraging renewable energy expertise in areas like solar and offshore wind power
...Amending articles of incorporation and setting up a dedicated entity for the power brokerage business... Building a net-zero network throughout the industry value chain
... Showcasing prowess in net-zero strategies and plan by being the first among listed Korean construction companies to get SBTi carbon reduction target approval
Hyundai E&C will accelerate its net-zero management by launching a power brokerage trading business.
On September 8, Hyundai E&C signed a strategic partnership with energy IT startup “60Hz” through equity investment. Through this partnership, Hyundai E&C will jointly develop technologies and product models essential for power brokerage transactions to create an integrated IT platform for energy trading. Hyundai Motor Company’s ZER01NE and Hyundai Motor Securities also participated in the investment, highlighting the group's efforts to achieve net-zero.
60Hz is a climate tech startup specializing in renewable energy generation forecasting and VPP* software development. It has garnered significant recognition in the IT technology domain of the energy sector, clinching the “CES 2023 Innovation Award” and the “Presidential Award for Startup Contest on Use of Public Data”. Demonstrating its prowess, the company has also shone in in-house challenges, earning the Excellence Award for “Seosan Solar Virtual Power Plant (VPP)” at the 2022 Hyundai E&C Technology Competition. Furthermore, it was chosen for the Hyundai E&C Open Innovation and the Hyundai Chung Mong-koo Foundation’s “H-On Dream'” initiatives, partnering with Hyundai E&C for collaborative research and technological advancement.
*Virtual Power Plant (VPP): A digital power plant that seamlessly integrates and controls distributed, small-scale renewable energy resources via an ICT-driven software platform.
Energy IT technology plays a pivotal role in the power brokerage trading sector, which encompasses numerous power generation sources and consumers. The unique nature of electricity, involving both simultaneous generation and consumption, necessitates precise demand and supply forecasting and management well as effective communication with entities like KEPCO and power exchanges. Especially in the case of renewable energy, where power plants are distributed on a small scale across the country, power generation forecasting is essential for stable power supply.
Through this partnership, Hyundai E&C will become the first in Korea to introduce an IT platform that automates power transactions, including “direct PPAs*” in the private sector. By establishing an IT-enabled energy communication ecosystem with automated matching, contracting, and settlement capabilities between power producers and consumers, and by offering financial and technological solutions to power producers and solutions like RE100* portfolio establishment and implementation tracking management to consumers, the company aims to progress towards developing an integrated power generation (VPP) platform.
*Power Purchase Agreement (PPA): Direct PPA is a direct contract between electricity consumers and renewable energy electricity suppliers, and third-party PPA is a system where electricity consumers and power generators conclude renewable energy power transactions through KEPCO's intermediary
*Renewable Energy 100%(RE100): A voluntary global campaign to have 100% of the electricity a company uses come from renewable energy.
As the importance of realizing carbon neutrality increases, the number of companies joining the RE100 is increasing, and Hyundai E&C is providing strategic consulting to a number of companies in demand using the “RE100 Portfolio Simulator” program co-developed with 60㎐. Furthermore, based on its capabilities accumulated through EPC (design, procurement, and construction) of power facilities such as power plants, transmission lines, and substations, as well as its know-how in operating renewable energy businesses such as Seosan PV park and the Jeju Hallim Offshore Wind Farm, Hyundai E&C plans to lower the entry barriers for new power generation and companies and enhance the stability and efficiency of the power trading market by providing differentiated analysis and consulting, including financing and technical support.
Hyundai E&C has been preparing various solutions to facilitate the establishment and implementation of carbon neutrality strategies across the entire value chain of the industry by speeding up its entry into new energy businesses in the field of power brokerage transactions, including incorporation of the “renewable energy electricity supply business and small-scale power brokerage business” in the articles of incorporation and establishing a specialized organization for power brokerage transactions through the general shareholders' meeting in March.
Earlier this year, Hyundai E&C signed an “MOU on Renewable Energy Transition Cooperation” with the “Namdong Smart Mobility Mini-Cluster”, an industry-academia-government collaboration group led by auto parts companies in Incheon's Namdong Industrial Complex. The agreement aims seek collaboration in the areas of commercializing renewable energy facility construction and supplying renewable energy electricity. In June, the company inked an “MOU on the Regional Innovation Ecosystem Development for Comprehensive Support for Carbon Neutrality of SMEs in Incheon” with seven organizations including Incheon Metropolitan City, Korea SMEs and Startups Agency, and Korea Industrial Complex Corporation, to establish a cooperative network for energy transition of small and medium-sized enterprises.
Among others, Hyundai E&C plans to discover Korea's only RE100 large, medium, and small-scale win-win success model and systematically upgrade its renewable energy conversion model by diagnosing power usage, building renewable energy power plants, and supporting the establishment of a renewable energy and carbon credit trading platform.
Since becoming the first listed builder to declare net-zero strategy based on SBTi* in October 2022, Hyundai E&C has been systematically implementing its net-zero initiatives by expanding its green portfolio, introducing energy reduction measures in office buildings, and introducing solar self-generation facilities at construction sites. The company has been included in the DJSI World for 13 consecutive years in the DJSI evaluation and has been inducted into the CDP Korea Hall of Fame for five consecutive years in the climate change category of the Carbon Disclosure Project (CDP), and recently became the first listed Korean builder to obtain carbon reduction target approval from SBTi*, showcasing the competitive edge and objectivity of its net-zero implementation and future plans.
*Science Based Targets initiative(SBTi): The Science Based Targets initiative is a global coalition that validates companies' greenhouse gas reduction targets, based on scientific evidence.
An official from Hyundai E&C said, "Building on our know-how in renewable energy EPC and business operations, we will not only stabilize the power trading market, which is gradually opening up to the private sector, from the outset, but also solidify our position as a reliable net-zero solution partner,” adding that, “On top of the power brokerage trading business, we plan to actively keep pace with Hyundai Motor Group's net-zero and green management initiatives, following the joining of RE100, by establishing a recycled energy conversion model and introducing energy use lowering technologies through various measures.”